Your new vehicle needs full coverage from Nest Insurance Agency since any peril-caused damage or single-vehicle accident would go uncovered otherwise. That would mean purchasing a car out of your pocket.

When your vehicle ages, though, does it stop making sense to cover it fully? It depends on the age of the vehicle and its type.

At ten years old, the average used vehicle costs about $7,990. According to Value Penguin, the cost of full coverage and its deductibles equals about half the vehicle’s value. At 15 years of age, total coverage premiums exceed the value of the typical used car. That means that once your vehicle reaches the age of 15, you’ll pay more than its value yearly in premiums.

That’s in reference to the average vehicle. What about when you own an exotic vehicle or a luxury vehicle? That changes everything!

That Corvette or BMW that you cruise around Lubbock or Amarillo, TX driving may increase in value as it ages. Many luxury vehicles do this. Check the Kelley Blue Book for the value of your vehicle. Full coverage makes sense if it continues to appreciate in value rather than depreciate in value or holds its own in value.

A vehicle that appreciates in value or holds its value would cost the same or more than the price for which you purchased it to replace. That means your 10-year-old Chevy Corvette might cost more for you to replace if you incurred a single-vehicle accident and weren’t carrying full coverage. That would mean replacing it out of pocket.

At Nest Insurance Agency, we serve the Lubbock and Amarillo, TX area with the auto insurance its residents need to protect their automotive investments. Call us today to purchase an auto policy that appropriately protects your investment.